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Marvin Lumber & Cedar Co. v. PPG Indus. - 401 F.3d 901 (8th Cir. 2005)

Rule:

Consequential damages must be proven with a reasonable degree of certainty and exactness. For future losses specifically, a plaintiff cannot collect damages that are "remote, speculative, or conjectural." Absolute exactitude is not required, however. Instead, the plaintiff must prove the reasonable certainty of future damages by a fair preponderance of the evidence. 

Facts:

Plaintiff Marvin Lumber & Cedar Co. i(Marvin) s a family-owned company that manufactures, among other things, millwork products, such as wooden doors and windows. Defendnt PPG Industries (PPG) sells wood preservatives and coatings. The genesis of this lawsuit was Marvin's use, from 1985 to 1988, of PPG's wood treatment PILT (preservative in-line treatment) on Marvin's doors and windows. PILT replaced the industry standard in wood preservatives, products containing pentachlorophenol (Penta). Marvin had used Penta products successfully for years until environmental concerns were raised about the active ingredient. In 1994, Marvin filed this diversity suit seeking damages on a number of legal theories, claiming that PILT had failed to prevent premature rot and decay in Marvin's wood products. The district court dismissed or granted summary judgment to PPG on all counts. Marvin sought appellate review.

Issue:

1) Did the District Court err when it granted judgment as a matter of law (JAML) in favor of Marvin on the question of notice? (2) Did the District Court err when it declined to enforce a term that purports to limit damages?

Answer:

(a) No (b) No

Conclusion:

On appeal, the court affirmed in large part, holding, inter alia, that (1) the manufacturer was entitled to judgment as a matter of law on the issue of notice under Minn. Stat. § 336.2-607 (2002) because the documents upon which the seller relied were not sufficient to show that the manufacturer knew or should have known that the wood-rot problems it was experiencing beginning in 1989 through 1992 were the result of pretreatment with the preservative; (2) the damage limitation provision in the contract was not enforceable because it would result in both hardship and surprise to the manufacturer under Minn. Stat. § 336.2-207(2) (2002). The damages limitation language from the PPG acknowledgment forms therefore did not become a part of the contract between PPG and Marvin and is not enforceable. However, the appellate court remanded for trial Marvin's claim for breach of an express warranty of future performance, having concluded that there remained genuine issues of material fact on the claim. Marvin alleged that the warranty arose from representations by PPG to Marvin employees that wood products treated with PILT would last as long longer than Penta-treated products.

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